But it can now be revealed that, initially, Dave Allen, the club's former chairman, and fans' group Wednesdayite were provided with a document showing 100m Euros – just under £80m – in funding from the Private Capital Bank in Dominica.

The money was intended to cover the buying of a controlling stake in the club, deal with Wednesday's Co-op bank debt of over £20m with substantial investment then set aside for new players.

Dave Allen said: "The letter of proof of funding showed the funds were in a bank in Dominica. I then thought they would be moved from there to Switzerland and from there to this country."

Mr Allen said on that basis he was satisfied Mr Sheard did have the funds to repay £2.5m in loans and around £1m for his 10 per cent shareholding.

But he added: "I made him aware that before I could accept any money it had to be cleared through a High Street bank in this country which he said he would do and that it wasn't a problem. The ball is in his court."

However, Sheard has flatly denied the Dominica link, saying the money "never has been in the Caribbean."

Wednesdayite were shown the same initial proof of funding before later receiving a letter, on July 11, from Swiss-based lawyer Dr Hans Ulrich Sutter which confirmed that cleared funds were held in a major Swiss bank to buy shares and that he had satisfied himself of the funds origin. It is also known that Sheard was previously working with two different lawyers in Leeds earlier in the year but that neither went on to be appointed as his representative.

When Wednesdayite members voted to sell, in principle, their 10per cent stake in the club to Sheard on August 6, it appeared a deal was close to completion.

The Lancashire-based businessman, who says the backers wish to remain anonymous, said a deal was only 'days away' two weeks ago and last night told the Yorkshire Post he expected the deal to be concluded next week.

He initially said the current whereabouts of the funds was "none of your business" before saying they were now held in a UK bank.

Sheard also said: "I never said there was any money in the Caribbean. The money is not coming from the Caribbean I can assure you."

If the money is in a UK bank, the final hitch to the deal could be the repayment of loans to three other parties, separate from the four key shareholders – Allen, Wednesdayite, Geoff Hulley and Keith Addy who own 40per cent of the shares between them. All four have agreed, in principle, to sell to Sheard.

But the proposed takeover would initially involve buying 29.9 per cent of the club's shares – just short of the 30 per cent mark which triggers an automatic offer for the remaining shareholding. Wednesdayite have had no further indication that Sheard intends to buy the fans' group's stake, instead focusing on the other three main blocks of shares.

Throughout the prolonged takeover process, the football club itself has said very little. Financial consultants Deloitte Touche were appointed by the club in May to seek out fresh investment but there has been no indication this has borne fruit.